Which statement is true about the relationship between deductible and coinsurance in the example?

Which statement is true about the relationship between deductible and coinsurance in the example?

• A. Deductible is paid first, then insurer pays 80% of the remaining eligible expenses
• B. Coinsurance is paid first, then deductible applies
• C. There is no deductible in major medical policies
• D. Coinsurance is 100% in all cases

Answer: (A)

In this scenario, you first pay the deductible out of pocket. Once the deductible is met, cost-sharing begins on the remaining eligible expenses. If the plan covers 80% after the deductible, the insurer pays 80% of those remaining charges and you pay the remaining 20%, until you hit your out-of-pocket limit. This sequence—deductible first, then coinsurance on the rest—is why the statement is true for the given example.

The other ideas don’t fit typical major medical designs: coinsurance isn’t paid before meeting the deductible, there usually is a deductible in major medical plans, and coinsurance isn’t always 100% in all cases (there’s always some sharing unless the plan provides full coverage).